It's quite obvious what Microsoft is doing. They are getting their hands on Sonys highest selling 3rd party games. The sales of games these days on HD consoles, if you look well have taken a huge downward spiral. This is the first gen where Japan is barely supporting JRPG's. Enix knows they are going to lose money, and Sony's fanbase aren't purchasing at a strong enough rate to be trusted as an investment. Microsoft found Sony's weakness and is now focusing on using that to it's advantage. They took GTA last gen, but it barely weakened Sony because they had the bulk of the 3rd party support still. This time around they did the same thing that Sony did, but theres a twist. They blocked off Sony's third party by securing a more profitable installed base than Sony. This compelled Capcom to make Devil May Cry multiplat, FFXIII, GTA IV and more.

My reasoning for why the 360 isn't dominating:

-Microsoft is focusing too much on hurting Sony, by exposing their true weakness and not focusing on moving forward. Sony is trying to ignore Microsofts moves, when thats the most unrealistic thing, because it's hurting them. MGS4 was the best thing that could've ever happened to Sony this year. Both Sony and MS will do pretty well this holiday season from my estimations. Microsoft is in the least position out of all systems to dominate, due to brand respsect.

-The world doesn't know what to think of an American system being at the level that the 360 has attained without the help of Japan.

-The mass market usually responds after the first three to four years. The true war between the 360 and PS3 will start near to the end of the 4th quarter.

-Economy

However....this topic is "Why does the 360 sell so well in America?"...and Microsoft has Sony beaten by more than double over here. America and Europe are the most important markets and right now Japan is not even a factor into the sales of HD consoles. Japan has pledged their support to the Wii so far. In conclusion we STILL don't know, because of the fact that the real consumers will come out of the wood work once consoles drop to market price. As I said...this only occurs after the first 3-4 years. Sony isn't dropping price to $299 for the mass anytime soon, they just increased their lifespan to 10 years to try and make profit.

Because it's got a better library and is slightly cheaper, why the PS3 sells better in Europe is a far more interesting question since the price difference is even bigger there.

Its an American made product thats my view.

 That makes no sense economically, because Americans are more sporadic and less loyal than any other country in the world. We buy what we want based on quality or because of economical status.

japan leads the world in terms of adoption of newest technology.

I think the shallow society combined with a poor education system is what benefits the xbox.

 Really, for a long time I thought you were only a Sony fan DTG. but then you make what is quite possibly the worst excuse I've ever heard for why the 360 is doing well in America. Well, I know your just being sarcastic though. but wow, that would cross the line past Sony Fanboy if you meant it.

@Rock_on: I do wish fan loyalty would continue. If this was true though, we would still all be following Atari, Nintendo and SEGA.

@shadowblind.... so are you saying you dont pull out a snes and play original mario kart .... (loyalty is rare... and it breeds creepyness.... just look at apple fanboys.... we have created a religion)

americans love shooters and sports games

I think bias is your clear problem. I also think that you need to realize that most Americans KNOW that electronics is no longer our fortay. We gave up electronics in the early 90's...the same time Sony lost most of their hold on the competitive electronics market and Sony didn't believe in Kutagari's genius in seeing the use of a videogame system. Kutagari is a genius surrounded by a bunch of arrogant fools in Sony. Kutagari is the reason why they controlled videogame marketshare last gen.

Americans in general like shooters. Other than top down space shooters, I dislike shooter games. I bought a 360 for JRPGs, Banjo Kazooie, and Viva Pinata. Also, since so many people have it, I may get a shooter or two and play with my friends.